AMD Construction and Negotiation
Read Case 3: AMD Construction in the text (pg. 448-450) and answer the following questions in a three- to -four page, APA formatted paper:
- Discuss the various steps in the capital equipment acquisition process.
- Develop a comprehensive analysis of the negotiations between Jane Axle and Tom Reed. (Provide a chart to show financial impacts.)
- What is your assessment of the negotiations process, given what you have studied? What are your recommendations for Mr. Reed? You must justify your conclusions.
Suggestion of format for analysis:
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Current Machine
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CAT-1 machine-purchase
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CAT-1 machine - Lease
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Operating cost (without operators)
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Direct Labor
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Depreciation (straight line) 4 months
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Lease Expense 4 Months
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Interest expense at 8% for 4 months
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Salvage Value after 3 years
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Unexpected Costs
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Totals
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